Although they've been a favorite topic for our blogs over the years, we realized that it's been a little while since we sat back and reflected on where mortgage rates currently are. So maybe a catch up is in order.
The simple fact remains that still low rates continue to greatly inform the Albuquerque area real estate market, just as they are doing for the nation as a whole.
The positive reaction of financial markets after last November's election (can it really be almost a year ago!) meant that safe haven bond investment became less attractive for a while, in favor of riskier opportunities and we consequently saw a gradual rise in rates into the New Year. The most interesting aspect, though, was that it made no traceable impact on the growing success of our local market.
This trend continued for a while, but in recent months we've seen yet another return to very low rates and a somewhat fluctuating situation from week-to-week as rates rise a little, then drop a little. There seems to be a cyclical pattern.
In essence, however, rates remain incredibly competitive on any historic scale.
They have stayed in a relatively stable position, as mixed news in the economy continues. In the past couple of weeks, for example, we've seen a report of better than anticipated retail sales and a less than expected rise in the Consumer Price Index (CPI) in September, plus job losses (mainly due to natural disasters) and an overall fall in the employment rate in August, with higher than expected wage growth.
All of these factors play a part in the attractiveness of bonds, meaning that Mortgage Backed Securities (MBS) become more popular when news is less favorable, in turn driving down the mortgage rates lenders offer.
Another key situation that's giving markets cause for pessimism is continuing international tensions, with a particular focus on events related to North Korea.
When we sit back and take a longer term look at mortgage rate trends in recent years, we can see that pretty much the same basic set of dynamics have been preventing rates rising to what most experts would consider to be more normal levels.
And as we head into the final phases of 2017, we can confidently expect much expert commentary on where mortgage rates will go in the New Year.
The volatility of the world we live in suggests that nothing is ever certain and, in some senses, all bets are off for what might, or might not, happen to rates in the next 12 months.
What is certain, however, is that right at this moment rates are still so attractive, giving buyers a great incentive to act now and providing sellers with a lot of extra motivation to list their home at a time of low inventory of available properties for sale.
Whether you're buying or selling, or doing both, please don't hesitate to give us a call today to discuss how we can help to maximize what's happening right now in Albuquerque and New Mexico as a whole.